Natural gas pipeline. Photo: Iakiv Pekarskyi/Shutterstock.com.

A Florida lawsuit from a natural gas distributor seeking reimbursement for a confidential settlement it paid over an underground explosion reached the Florida Supreme Court Wednesday, when litigators sparred over how to apply an underground safety statute.

In oral arguments held over Zoom, justices considered whether the law allows a third party to be liable for settlements paid out over damage it allegedly caused, in a lawsuit with little case law to lean on.

The incident happened in 2010 during a Fort Myers road construction project led by Posen Construction Inc., which enlisted Peoples Gas System to remove a section of gas pipeline. But its worker Mark Santos was injured when his digging ruptured the gas pipeline and caused an explosion.

That resulted in years of litigation as the worker sued both companies, which also sued each other. But in this case, Peoples Gas claims the construction company knew the pipeline wasn't properly marked — an alleged violation of the Florida Underground Facility Damage Prevention and Safety Act, which allows utilities to recover compensation when utility lines are negligently damaged.

If the defendant had complied with the statute, the plaintiff alleged it wouldn't have had to pay a settlement to Santos. Though that amount isn't public, the statute at issue caps damages per facility at $500,000.

Counsel to Peoples Gas Jason Gonzalez of Shutts & Bowen in Tallahassee argued that the Middle District of Florida was wrong to dismiss his client's suit because the statute says that a negligent party is "liable for the total sum of the losses to all parties involved as those costs are normally computed."

"If you violate the statute and then rupture an underground facility, you're responsible for the total sum of the loss," Gonzalez said.

Florida Justice Carlos Muniz probed Gonzalez over the statute's ambiguities, calling his interpretation "a dramatic departure from the norm."

"It's not enough to just keep repeating that it says 'total sum of damages' when that has to be read in the context against which the legislature is writing this statute," Muniz said.

But Gonzalez countered that the statute says what it says.

"They [the defendant] may not like that, but they need to go to the legislature to get an exception," Gonzalez said.

'Anything and everything'

Posen's attorney Hinda Klein of Conroy Simberg in Hollywood argued the district court got it right, because the statue doesn't mention anything about the right to indemnity — meaning, to be compensated for damages cause by another party.

"PGS is implying that because the statute doesn't define the term 'losses,' that necessarily means that they can sue us for anything and everything, and there isn't a case in the United States that supports that contention," Klein said.

Klein urged the court to consider the statute in conjunction with common law, which favors comparative fault over indemnity. She pointed to case law that says courts should narrowly interpret statutes that don't gel with common law.

But Justice Ricky Polston countered by pondering why indemnity shouldn't fall under "the total sum of losses" when the statute doesn't outright exclude it.

Klein also highlighted that some of the claims Santos brought against Peoples Gas included allegations that had "nothing to do with this statute."

The court has yet to rule.

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